DEPARTMENT OF TOURISM
PHILIPPINES
06 August 2020
CONG. ALAN PETER S. CAYETANO
House Speaker
Taguig-Pateros, 1st District Representative
House of Representatives, Quezon City
Dear Speaker Cayetano:
Warmest greetings from the Department of Tourism (DOT)!
We respectfully write with reference to House Bill No. 6953 entitled An Act Providing for COVID-19 Response and Recovery Interventions and Providing Mechanism to Accelerate the Recovery and Bolster the Resiliency of the Philippine Economy, Providing Funds Therefor and for Other Purposes, or the "Bayanihan to Recover As One Act," which passed through the second reading last Wednesday.
We are grateful for the generous allocation of PhP 10 billion for tourism in the bill. However, we note that under Section 7 of the bill, the allocation of P10 billion is to be given to the Tourism Infrastructure and Enterprise Zone Authority (TIEZA), the DOT's attached agency for infrastructure projects, "to finance programs assisting the recovery of the tourism industry, that shall include the provision of tourism infrastructures"
In this regard, the DOT respectfully appeals that the PhP 10-billion fund be instead dedicated to tourism to help address the immediate needs of the tourism industry. And the most urgent need and request of our stakeholders who have been among the hardest-hit by the pandemic with many of them having no or little operations since March is liquidity. As their revenue streams have been drastically affected, we need to immediately provide them access to working capital loans and other credit facilities.
This immediate need for credit facilities was especially highlighted during our several consultations with our stakeholders. In the present crisis, we sincerely believe that the direct accountability of preparing a response and recovery plan rests with the DOT in consultation with the stakeholders. To do otherwise would ignore the urgency of the situation and would be inconsistent with the mandate of the DOT under RA 9593 as the primary planning, programming, coordinating, implementing and regulatory government agency in the development and promotion of the tourism industry, both domestic and international.
It should also be noted that direct financial support to the tourism industry in the form of credit also forms the core of alleviate measures taken by other countries to help their tourism sector.
We are aware that PhP 51 billion has been allotted to the GFIs for various credit programs for MSMEs under the House Bill, and we have been told that that would sufficiently address our needs. However, given the overwhelming need of our tourism enterprises for access to credit, and in order to ensure that they are given priority in the allocation of credit, we stress that the better use of the PhP10 billion is to provide dedicated additional credit to tourism enterprises. Needless to state, tourism infrastructure is also important, but it will not address the immediate needs of the tourism industry. It can be planned for and implemented at a later time once we have assured the survival of the industry.
It bears to stress that the survival of the tourism industry is of the utmost concern for the Philippine economy. For the past five years, the Philippines has been relying on tourism for more than 10 percent of its GDP and employment. In 2019, the tourism industry recorded a contribution of 12.7 percent to the country's GDP. Inbound tourism ranked second among tthe biggest export items, next to semiconductors. Moreover, the tourism Industry boosted the country's employment with 13.5 percent share accounting for 5.7 million workers.
We, therefor, earnestly appeal that the PhP 10-billlon be given to the DOT as a dedicated fund primarily for credit. Thus, we propose that Section 3(ff) of the House version may be reconciled with Section 3(gg) of the Senate version, to read as follows:
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Direct the Department of Tourism (DOT) to assist critically impacted businesses that are tourism enterprises, including tourism oriented barangay micro business enterprises, or other members of the informal sector in any of the following programs:
(1) Low interest loans or issuances of loan guarantees through GFls with terms of up to five (5) years for maintenance and operating expenses;
(2) Credit Facilities through GFls for upgrading, rehabilitation, or modernization of current establishments or facilities to be compliant with the new and health and safety standards;
(3) In partnership with the LGU and DOH and/or private entities, establish COVI0-19 testing centers in tourist destinations as identified by the DOT, to stimulate tourism and generate employment.
For purposes of items (1) and (2) herein, government financial institutions such as the LBP and DBP shall administer the loans for DOT but subject to guidelines from the DOT that shall be prepared for these purposes: PROVIDED, That the loan interventions implemented under this Section shall
be exclusively for accredited tourism enterprises, including such small-scale tourism enterprises accredited by LGUs.
Availment of grants, loans or loan guarantees through other provisions of this Act is not a disqualification for any tourism enterprise to avail of any economic relief measure in this Section.
With your kind indulgence and support, we hope that Philippine tourism will rebound and continue to be a major contributor to economic growth.
Thank you.
Click here for a copy of the actual letter.
Very truly yours,
[signed]
BERNADADETTE ROMULO-PUYAT
Secretary